- Coinbase founder foresees FIT21 Act getting a bi-partisan pass in the US Senate.
- However, some industry figures have opposed the Act as ‘horrible’ for DeFi.
US crypto regulation took remarkable steps in May after the House of Representatives passed key bills, such as the US CBDC Anti-Surveillance State and the FIT21 Acts.
In particular, the Financial Innovation and Technology for the 21st Century Act (FIT21 Act) was hailed by policymakers as a game-changer that could offer more clarity for the crypto sector.
However, the passing through the US House of Representatives was just the first step. Most market observers foresaw a divided US Senate as a key hurdle for the Act to advance and have a chance of becoming law.
FIT21 Act could pass the US Senate?
It looks like that could change, per a recent update by Coinbase founder and CEO Brian Armstrong. In a recent X (formerly Twitter) post, the executive stated,
“I met with more than a dozen Dem and GOP Senators in DC over the last 48 hrs to discuss creating clear rules for the crypto industry and consumer protection for crypto users.”
Interestingly, Armstrong was confident that the FIT21 Act could sail through the Senate. Following his meeting with lawmakers, the executive added that,
‘There’s strong bi-partisan momentum to get this done in the Senate now that FIT21 has passed in the House. Glad to see the voice of the crypto voter having an impact.’
For the unfamiliar, the FIT21 Act aims to create a regulatory framework for digital assets, and the CFTC (Commodity Futures Trading Commission) could handle a large portion of the mandate.
However, the bill has also faced opposition from within the crypto community. The opponents deemed some clauses of the Act as not entirely fit for the DeFi segment. One X user stated,
“No. the bill is horrible for DeFi. wait for Trump to win, and then let’s pass something much better.’
Most market observers had raised the KYC (Know Your Customer) requirements as an anti-privacy ethos championed by DeFi.
However, others maintained that the Act doesn’t apply to the DeFi sector. Reacting to the Act in late May, Hayden Adams, founder and CEO of Uniswap, stated,
‘Acknowledgement in Congress that it is fundamentally different needs to be studied and treated differently is a huge deal and a clear step in the right direction for the country.’
Adams, one of the instrumental builders in the DeFi sector, added that the government opted to study DeFi first, a move that mirrors what the EU did before rolling out its regulatory framework known as MiCA (Markets in Crypto Assets).
That said, it remains to be seen whether the US Senate will pass the bill and later get the president’s green light to become law. The upcoming US elections could also complicate the timeline of the process.
